Jo-Ann Stores (JAS)

 

In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of those assets may not be recoverable. Factors considered important that could trigger an impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results and significant changes in the manner of use of the assets or the company’s overall business strategies. Potential impairment exists if the estimated undiscounted cash flow expected to result from the use of the assets is less than the carrying value of the asset. The amount of the impairment loss represents the excess of the carrying value of the asset over its fair value. Management estimates fair value based on a projected discounted cash flow method using a discount rate that is considered to be commensurate with the risk inherent in the company’s current business model. Additional factors are taken into consideration, such as local market conditions, operating environment and other trends.

 

In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of those assets may not be recoverable. Factors considered important that could trigger an impairment review include, but are not limited to, significant underperformance relative to historical or projected future operating results and significant changes in the manner of use of the assets or the Company’s overall business strategies. Potential impairment exists if the estimated undiscounted cash flow expected to result from the use of the assets is less than the carrying value of the asset. The amount of the impairment loss represents the excess of the carrying value of the asset over its fair value. Management estimates fair value based on a projected discounted cash flow method using a discount rate that is considered to be commensurate with the risk inherent in the Company’s current business model. Additional factors are taken into consideration, such as local market conditions, operating environment and other trends.

 

Based on management’s ongoing review of the performance of its stores and other facilities, the following impairment losses were recorded and are reflected in selling, general and administrative expenses (“SG&A”) on the consolidated statement of operations.

 

 

 

In accordance with SFAS No. 144, “Accounting for
the Impairment or Disposal of Long-Lived Assets,” the
Company evaluates long-lived assets for impairment whenever
events or changes in circumstances indicate that the carrying
amount of those assets may not be recoverable. Factors
considered important that could trigger an impairment review
include, but are not limited to, significant underperformance
relative to historical or projected future operating results and
significant changes in the manner of use of the assets or the
Company’s overall business strategies. Potential impairment
exists if the estimated undiscounted cash flow expected to
result from the use of the assets is less than the carrying
value of the asset. The amount of the impairment loss represents
the excess of the carrying value of the asset over its fair
value. Management estimates fair value based on a projected
discounted cash flow method using a discount rate that is
considered to be commensurate with the risk inherent in the
Company’s current business model. Additional factors are
taken into consideration, such as local market conditions,
operating environment and other trends.

 

Based on management’s ongoing review of the performance of
its stores and other facilities, the following impairment losses
were recorded and are reflected in selling, general and
administrative expenses (“SG&A”) on the
consolidated statement of operations.

 

 

 

Under Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” long-lived assets, except for goodwill and indefinite lived intangible assets, are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. Assets to be disposed of are recorded at the lower of carrying value or estimated net realizable value. We conduct this review on an ongoing basis and record any required impairment charge. The Company performed impairment tests during the fourth quarter of fiscal 2007, fiscal 2006 and fiscal 2005. Impairment cost for closed stores is recorded in store pre-opening and closing and impairment for stores still in operation is recorded in selling, general and administrative expenses (“SG&A”) on the consolidated statement of operations. Asset impairments include write-downs of fixed assets to their estimated fair value for stores closed, or